Harsh cuts await as the oil field slips into recession
West, James Hoh, Samantha Nuta, Alexander Schnier, Cameron
Harsh cuts await as the oil field slips into recession - feb. 2015 - 1 p. ; 37-38
E&P spending may fall below $700 billion in 2015, as budgets will be dictated by cash flow and access to capital, according to a survey of the spending plans of approximately 300 companies worldwide. The year ahead is set to be transitional for the upstream industry, marking the second recession in a 15-year, global E&P spending upcycle. With 2014 spending finishing stronger than expected, and a significantly changed price environment, Evercore believes that near-term capital expenditure (capex) revisions put its survey’s modest 5% contraction for 2015 at risk. The company expects near-term capex announcements to reflect about 30%–40% cuts to previous plans, bringing full-year North America spending closer to a 30% contraction and international spending to a 15% contraction.
2
Harsh cuts await as the oil field slips into recession - feb. 2015 - 1 p. ; 37-38
E&P spending may fall below $700 billion in 2015, as budgets will be dictated by cash flow and access to capital, according to a survey of the spending plans of approximately 300 companies worldwide. The year ahead is set to be transitional for the upstream industry, marking the second recession in a 15-year, global E&P spending upcycle. With 2014 spending finishing stronger than expected, and a significantly changed price environment, Evercore believes that near-term capital expenditure (capex) revisions put its survey’s modest 5% contraction for 2015 at risk. The company expects near-term capex announcements to reflect about 30%–40% cuts to previous plans, bringing full-year North America spending closer to a 30% contraction and international spending to a 15% contraction.
2
